27 passive income ideas by time and money: follow your passion and build wealth

This article lists 27 passive income ideas. For related questions about passive income, check our article How to make passive income.

Table of Contents

I spent 1 week of web research and combined it with personal experience in many financial institutions for saving and investing.

The goal of this article is to inspire you. In this list, you could find one passive income idea that resonates with you most. If it is built around your hobby and passion then you will most likely stay with it in the long term. You can then combine many ideas for increased passive revenues.

Do you prefer spreadsheets to analyze ideas? Check our spreadsheet.

The Gist (“Too Long Didn’t Read” version of the article)

13 passive income ideas requiring mostly time (little to no money) cover categories below

  • Entrepreneurship through outsourcing and automation.
  • Write once and sell many times.
  • Media creation once and sell many times.

14 passive income ideas requiring mostly money (little to no time) include categories below

  • Rent things you already own.
  • Save the money you already own.
  • Invest the money you already own.

For every idea there are 4 axes analyzed:

  • Reward: factors mostly affecting your rewards. How do you earn money?
  • Risk: items to consider to avoid losing efforts in time and money.
  • Time: tasks that take the most time.
  • Money needed: amount required to get passive income and sustain it.

Please use this list below as a way to access quickly the passive income idea that interests you.

Requiring mostly money:

Requiring mostly time:

Here below the 27 ideas:

Ideas requiring mostly time (little to no money)

Entrepreneurship. Source: Prosperous Frugal
Media. Source: Prosperous Frugal
Write. Source: Prosperous Frugal

1 Affiliate Marketing, Network Marketing, help a business get clients

  • What options to earn financial rewards?
    • Recommend and earn a commission.
    • Good affiliate links: Be ethical and recommend products you would personally use.
    • The upside to it is that almost every big brand has an affiliate program.
    • 35% of affiliates globally earn over $20,000 per year [1].
  • Rewards: how do you earn money?
    • Specialize: Prefer to focus on the small scope of products to recommend. Find a niche (topic/interest/hobby), create a site, and join affiliate programs.
    • To earn $100 per month, let’s consider :
      • 5% commission
      • A product sold at $50
      • 1% conversion rate: from people visiting a page, what percentage to buy using your referral links (products you recommend).
      • A website needs 8,000 visits per month to get those $100
    • With Skillshare, to earn $100 per month you would need 15 people per month because you can get $7 through referrals.
    • Not difficult if you already have an audience like YouTube, Skillshare, website. Explore your creativity with SkillShare. Get a free month until 12/26/2022 using code AFF30122 when you invest in yourself this holiday season with unlimited access to classes on illustration, photography, design, film, music, and more.
Skillshare You Think. You can
  • Time
    • Audience: Build a community to increase your earnings. People in your audience will be already interested in your niche. Hence, more likely to buy products you recommend.
    • Page visitors: Use SEO and ads to drive traffic to your site. The more traffic you have, the more people are visiting your website. So, potential earnings increase.
    • Consistency: Effort creating content, updating once a week, repeating for 2 years. So few people stick for 2 years.
  • Risk
    • Trend: The risk of big effort and niche chosen was just a passing trend. Check Google Trends for that. Is the evolution stable or it is going downwards?
    • Commission: The only real downside is that you only make a commission on the sale. Some programs like Shopify’s affiliate program allow you to earn up to $58 per referral, which is a decent income [2]. Other online companies only give a measly $5-$10 referral bonus.
  • Money needed
    • Does not need capital to start.
  • Tools
    • Affiliate networks: Awin, ShareASale.
    • Affiliate programs: eBay Partner Network, Audible Affiliates, Shopify, Skillshare. Get a free month until 12/26/2022 using code AFF30122 when you invest in yourself this holiday season with unlimited access to classes on illustration, photography, design, film, music, and more.
      • Amazon Associates (simple sign-up).
        • People might not buy the product you recommended but another and if it is bought 24h after the user clicked on your link, you still make money.
    • Publicize in social networks
      • Instagram, TikTok, LinkedIn, blog, website, and YouTube (has good conversion rate).
  • Success story
    • Sireesha Narumanchi, Founder of Crowdworknews.com:
      • “The immense pleasure of helping people and showing them that there is a choice of working from home and earning a decent income is my trophy at the end of the day.”

Help businesses get clients

  • It can be through a lead generation website. Then becoming a silent business partner.
  • Typically uses referral fees and referral programs. $5 per lead in low-end leads.
  • For instance, real estate agents are always looking to help more people find a home they love. “1 person enterprises” will often be willing to pay a referral bonus for finding them a client that signs a contract. That includes freelancers, DJs, photographers, and others.

Network Marketing

  • Beware of scams (Ponzi schemes). Multi-level marketing (MLM) also exists. One key way to identify scams is to focus on their main revenue source. Are they getting revenues mostly from new recruits or from providing value selling products and services? Scams get it only from new recruits and products/services are a way to hide their real revenue stream.
  • Examples of common networks:
    • Young Living Essential Oils, Avon, Pampered Chef, AdvoCare, Herbalife, Mary Kay, DoTerra, and Rodan & Fields (R+F).
  • Network members can recruit others, use products, and share the company’s products with others.

2 Blog (create it vs buying one and maintaining it)

  • What options to earn financial rewards?
    • Ads in blog, affiliate marketing offers, and info products.
  • Rewards: how do you earn money?
    • The biggest perk of creating a blog is that you can turn that one asset into several different streams of income
  • Time
    • 6 months: Upfront effort of many months. It takes frequently 3 to 6 months to see the first revenue.
    • You can outsource labor to writers and digital assistants. But management and communication will be necessary as the blog scales.
    • 2 years: It might take 2 years to start generating recurrent jobs replacing income.
    • Consistency: Pick a niche you are passionate about. Frequently create new content to get authority and followers/visitors.
  • Risk
    • Trend: The risk of big effort and niche chosen was just a passing trend. Check Google Trends for that. Is the evolution stable or it is going downwards?
  • Money needed
    • Requires low capital if you create one.
    • If you buy a blog and then maintain it.
      • At least the initial test period would have been done by someone else and now you have an income-producing asset.
  • Tools

3 Business (Car-wash, vending machines, laundromat)

  • What options to earn financial rewards?
    • Revenue sharing by participating financially in an enterprise.
    • Acquiring a business that does not require your involvement. For instance:
      • Car-Wash (cinder-blocks, a pressure washer, and coin-operated). If not, rented to someone to operate it. If neither of both is done and it involves your time always, it is not really passive.
      • Vending machine
        • Vending machines are similar. You’ll want to place it somewhere with a decent amount of foot traffic, and you can outsource the restocking of snacks or drinks inside the machine.
      • Laundromat
      • Food truck
      • ATM
        • You make a profit from ATM fees charged each time someone uses the machine. You’re responsible for keeping the machine stocked with cash. You can also turn this into a passive income source by outsourcing this work to a trusted third party.
  • Rewards: how do you earn money?
    • It is key to organize a business to make it passive. Many tasks should be outsourced/delegated.
  • Time
    • Business creation is high time-consuming activity. Otherwise, if you buy an existing one, the upfront effort is in the capital.
  • Risk
    • Demand for the products and services: For instance, if you consider a car wash, be sure the neighborhood or surroundings are full of people having cars. For food trucks, near big buildings with many people going out for launch.
  • Money needed
    • Requires important capital to buy one existing business like a car wash. Much less for a vending machine.
  • Tools
    • Mainvest (from $100) for revenue sharing.
    • Worthy (from $10) lend for inventory 5% per year.

4 Create App/Software As A Service (SaaS)

  • What options to earn financial rewards?
    • App or website/software. Anything digital can go through a subscription. Then going under the SaaS umbrella: Software as a service. Alexa Skill for instance.
    • If you have a skill or service that you can share with others, you can build an app or create a product to sell. For example, if you are passionate about fitness and have a background in creating workouts, you could create a workout app.
  • Rewards: how do you earn money?
    • Through ads, software selling, licensing, or subscription.
  • Time
    • Easier if you already have the coding skills.
    • Besides the effort to create an app, bigger efforts are needed to actually sell it.
  • Risk
    • Check trends to know what type of apps are most downloaded. If you have an idea to fill a gap in an app store, then go for it.
  • Money needed
  • Tools
    • Kickstarter
      • Helps bring your creative projects to life. You can join Kickstarter to launch a project or to help back others’ projects. This platform is a great way to get your ideas into the world, see if there is a demand for your product and then get help with funding! Since Kickstarter’s launch in 2009, 18 million people have backed projects.
  • Success story
    • Flappy Bird: an extremely simple yet addictive game that went viral and at one point was earning its creator $50,000 a day from ad revenue.
    • Indie Hackers for success stories about people that created software revenue businesses. There you can find guidance and revenue numbers sharings.

5 Dropshipping/E-Bay Seller/FBA

  • What options to earn financial rewards?
    • To ship goods from a manufacturer or wholesaler directly to a customer instead of to the retailer who took the order.
    • FBA (Fulfillment by Amazon)
      • Most products on Amazon are sold by independent sellers. Amazon handles the storage and delivery.
      • The initial launch is difficult. Easier to maintain as Amazon handles the delivery.
  • Rewards: how do you earn money?
    • Once you create your Amazon account you could use the FBA Revenue Calculator for detailed revenue on specific products.
  • Time
    • Can turn active. Be careful to set it up in a passive way.
    • Do proper research for high demanding products.
    • It is better to find a dedicated course as it is a long-time investing activity.
  • Risk
    • If no appropriate effort was allocated finding high demanding products, one could end up buying products that cannot be easily sold.
  • Money needed
    • Can be low if you focus on finding demanding products.
  • Tools

6 E-book sell online/publish blank book

  • What options to earn financial rewards?
    • Identify the problem, solve the problem, and charge money for it.
    • Can be fiction or non-fiction (like auto-biographic).
    • To facilitate the writing process start with the final goal. Then decompose it into 10-15 things (chapters). After, focus on 1 chapter per week or month.
  • Rewards: how do you earn money?
    • 35% per copy in royalties using Amazon Kindle Publishing.
    • By creating how-to e-books on popular niches and marketing them, you could build a fan base of loyal readers.
    • Go with what sells more frequently. Follow the trend in topics.
    • Match a topic to write about (niche) with your passion. Maybe a non-fiction educational E-book could be passionate for you.
  • Time
    • For providing value with content: You can easily write an e-Book. But one that provides more value might take more time invested in research.
  • Risk
    • Competitive market.
  • Money needed
  • Tools

7 License Music/Audio tracks/Podcast/ Buy royalties

  • What options to earn financial rewards?
    • Audio can be used on many platforms: YouTube videos, computer games, movie trailers, TV adverts, corporate promotional videos, wedding videos, and indie film soundtracks.
    • You could consider joining a Performing Rights Organization (PRO) to properly license audios. Websites like ASCAP, BMI, or SESAC are vital for that.
  • Rewards: how do you earn money?
    • For podcasts:
      • CPM: cost per mille (thousand listeners).
      • $18 for 30-second ad per thousand listeners (CPM).
      • $25 for 60-second ad per thousand listeners (CPM) [3].
    • For $100
      • 1k downloads per episode if there is a weekly podcast, 4 podcasts per month
        • 30 seconds ads with 1k times listened.
      • There are over a billion podcast downloads on Apple Podcasts [4].
  • Time
    • Research: research your audience and find out what kind of content is trending. From there, you can quickly start building your portfolio of tunes.
  • Risk
    • Not really passive income. The difficult part is getting the formula that works. Then you can repeat it.
  • Money needed
    • For buying equipment for podcast recording or musical instruments. For more money-intensive activities, you could buy royalties.
  • Tools
  • Success story
    • Example podcast: Dream Girl
      • 200-500 downloads per episode after 5 months of launching. She started with no audience
      • At the end of 2021, we could expect her to reach $100/month.
      • Dr. Sheen Gurrib, a graduate of both Oxford and Cambridge, is a social entrepreneur and podcaster (Dream Girl). She is the co-founder of ReShape Co, a young, not-for-profit consulting company. ReShape Co enlists students and graduates to carry out non-profit consultancy work for SMEs, charities, and NGOs.

8 Print on-demand online store, Design T-shirts

  • What options to earn financial rewards?
    • Common printables:
      • Calendars
      • Decorations
      • Greeting Cards
      • Invitations
      • Meal plans
      • Organizers
      • Planners
      • Recipe cards
      • Wall Art
  • Rewards: how do you earn money?
    • Print on demand allows you to sell your custom graphics on products like t-shirts and other clothes, mugs, canvases, phone cases, bags, and more. You could even create your own branded products.
  • Time
    • Requires graphic design skills. So, less time is needed if you already have the skills.
  • Risk
    • Almost no risk. Except for the time needed to start creating designs.
  • Money needed
    • Low to no money expenses to start. For inspiration and design courses, it is possible to pay or learn from free content online.
  • Tools
    • CafePress for designs
    • Etsy
    • Shopify
    • Design on Teespring
      • Good to start.
      • Teespring prints and ships products.
    • Amazon Merch (make, pack, and ship)
      • Same designs from Teespring are also in Amazon. Free to start
    • RedBubble (non-exclusive)
      • Same design from Teespring and Amazon, now in RedBubble

9 Sell Info and digital Products

  • What options to earn financial rewards?
    • Share your passion through videos, e-books, checklists, and audio files.
    • Bundle of courses and discounts on them.
  • Rewards: how do you earn money?
    • Traf, sells iPhone icon packs that sells for $28.
      • Made $100k in a week because lots of people were willing to buy them [5].
  • Time
    • Course bundling is less time-consuming than other info product creation from scratch.
  • Risk
    • Of creating info products without a demand.
    • Sell the idea before working on it
      • Possibility to ask people what type of content they would like to see and create it. Survey the audience and do what they want.
  • Money needed
    • Low, mostly time to create the info products or buying courses to improve the info products.
  • Tools
    • Etsy for digitized artwork (e.g. monthly planners)
      • Adobe photoshop brushes, backgrounds, actions, and textures
      • Banners
      • Branding graphics
      • Branding kits
      • Coloring pages
      • Courses
      • Crochet patterns
      • Cupcake toppers
      • Digital paper
      • Fitness tracker
      • Fonts
      • Greeting cards
      • Inspirational wall quotes
      • Invitations
      • Knitting patterns
      • Labels
      • Marketing materials
      • Mock-ups
      • Organization printables
      • Party decorations
      • Party props
      • Party signs
      • Personalized stationery
      • Pre-made logos
      • Printable flashcards
      • Printable planners
      • Printable wall art
      • Resumes
      • Sewing patterns
      • Stickers
      • SVG’s
      • Tee-shirt designs
      • Vector designs
      • Wedding signs
      • Wine labels
    • Shopify store for digital products. Take a look at our article Make money from home.

10 Sell courses/Virtual summits

  • What options to earn financial rewards?
    • Courses: Recording avoids the “on” and “off” days or fear of missing important information.
    • Virtual Summit
      • Sell 3 different levels of access:
        • Live presentations are recorded.
        • Q&A during the event.
        • Only recordings are offered as replays.
  • Rewards: how do you earn money?
    • Tip: create several packages at different price points.
    • Monetization through AdSense, affiliates, and memberships.
  • Time
    • It can be challenging to get visitors to a page where courses are sold. That means more time is needed to build an audience.
    • Easier to maintain: Just update the course once in a while. Make sure traffic stays stable.
  • Risk
    • People might not want to pay. To counteract that, use Skillshare. Get a free month until 12/26/2022 using code AFF30122 when you invest in yourself this holiday season with unlimited access to classes on illustration, photography, design, film, music, and more.
      • Can avoid charging people and still get rewards if videos are uploaded to Skillshare are shared.
    • Coaching
      • To know the demand and reduce the risk of creating something people don’t want to pay for. You can get feedback for the course with elements that worked for many people.
  • Money needed
  • Tools
    • Teachable, Coursera
      • Can be short with a video, poster, or spreadsheet. Anything delivered digitally.
    • Udemy for courses
    • Skillshare
      • To earn $100, a course needs 1700 watch time or 28 hours. So, for a 1-hour course, 28 students would be needed to take that course.
      • An existent audience is convenient because people already trust you.
      • Skillshare also prioritizes good content as it gets recommended even by Skillshare.
  • Success stories
    • Online guides like Securityguardtraininghq.com.
    • For Ali, now in Skillshare, courses make between $60,000 to $65,000/month in passive income. Get a free month until 12/26/2022 using code AFF30122 when you invest in yourself this holiday season with unlimited access to classes on illustration, photography, design, film, music, and more.
    • Sumit Bansal, founder of Trump Excel: He started sharing his knowledge about Excel and got a lot of traffic on his page every month. His YouTube channel has more than 110k subscribers. He uses Teachable to earn from his knowledge sharing.

11 Sell Stock Photos

  • What options to earn financial rewards?
    • Take photos and earn money selling them on specialized stock photos websites.
  • Rewards: how do you earn money?
    • Passive income every time someone buys your photo.
  • Time
    • Low if you have already the habit of enjoying taking photos. If not, following a course might improve your photo shooting skills.
  • Risk
    • Maybe too much time or money invested in accessories does not justify the earnings done.
  • Money needed
    • Low if you have already a camera or phone.
  • Tools

12 Social media influencer/sponsored posts/paid community

  • What options to earn financial rewards?
    • Hosting events as an influencer.
    • Create a kit with social media accounts.
    • Paid membership if you already have an audience.
      • Subscription offers to access content (with teaser information).
  • Rewards: how do you earn money?
    • Rates for sponsored posts depend on your number of followers.
    • Could be possible to start a site with $10per month and with 100 clients it would make $1k per month.
  • Time
    • High. As new content should be uploaded.
    • Recurring revenue is not necessarily passive as you could keep working on uploading content.
    • Once you get the formula that works, it is easier to maintain. Provide you keep showing up with content.
  • Risk
    • Of losing the time invested.
  • Money needed
    • None.
  • Tools
    • Instagram: focus on niche, add email in account to be easily contacted. See “Instagram engagement” as a key ratio.
    • Patreon
  • Success stories
    • Example for Hanna Witton
      • She has 600 Patreon payers and states that someone could get between $2k to $5k per month [8].
    • Example Ness Labs $9 per month per client
      • Started in 2018 [9].
      • Paid membership started in March 2020 to get recurring revenue. Having more than 30k newsletter subscribers [10].

13 Video creation/selling. YouTube channel

  • What options to earn financial rewards?
    • Videos can be about a topic previously covered that you know. For instance, a YouTube channel with reviews of Udemy courses and affiliate links in Udemy once you have tested many courses.
    • People prefer a 5-minute video than reading a set of instructions.
  • Rewards: how do you earn money?
    • Through ads. Previous videos you recorded will generate most of the revenue. 55% of the amount paid for an ad is given to the video creator [11].
    • There are other ways to monetize a YouTube channel like merchandising and reviews but are not exactly passive.
    • Example of a channel with $2 per thousand views (CPM) and 50k views: If 1 video per week, the video should get 12.5k views to earn $100 in a month.
      • For Ali Abdaal, on average, for a given channel, 20% of their subscribers are the number of views. So, 60k subscribers would be needed for $100/month.
  • Time
    • A lot of effort upfront creating videos. Getting the first 1k subscribers is more difficult than keeping them.
  • Risk
    • Video space is still not so competitive.
      • Great video content is scarce compared to text-based.
  • Money needed
    • Almost none. Maybe spending on a course that could improve your earning potential.
    • For YouTubers reaching significant revenues, in the US as a single filer, it is possible to create an S corporation to avoid double taxation (individual and enterprise) [12].
  • Tools
    • YouTube
      • YouTube needs 1k subscribers and 4k hours of watch time. For a Youtuber like Ali Abdaal, it took 6 months and 52 videos to get that and he states that on average, 90 videos are needed to reach eligibility for YouTube Ads.
      • As general useful advice, you could do videos once a week for at least 2 years to keep the channel on track.
    • Keywords Everywhere
      • To know how many people are looking for a topic you want to create a video about.

Ideas requiring mostly money (little to no time)

Invest. Source: Prosperous Frugal
Rent. Source: Prosperous Frugal
Save. Source: Prosperous Frugal

1 Ads in car/home/building

  • What options to earn financial rewards?
    • Useful for long-time commuters.
  • Rewards: how do you earn money?
    • Pick a tool with an ad campaign and get paid.
  • Time
    • Just to choose the correct ad campaign.
  • Risk
    • Of picking an untrusty ad campaign.
  • Money needed
    • None if you have already the car.
  • Tools
    • Carvertise: It claims you can earn between $350 and $1500 for each campaign.
    • Wrapify: The more you drive, the more you earn. Based on how much the ad covers your car you can earn between $170 and $450 per month.
    • Vugo: Up to $300 a month.

2 CD or Bond Ladder/Annuities

  • What options to earn financial rewards?
    • Bonds
      • Series of bonds that mature at different times over a period of years.
      • The staggered maturities allow you to decrease reinvestment risk. That is the risk of reinvesting your money when bonds offer too-low interest payments.
      • There are also ETFs of bonds.
      • Bonds are created by companies and governments.
      • 2 key indicators are interest rate and term (bond duration).
      • Fixed income. Can offset volatility.
    • Certificates of deposits (CD)
      • In multiples of 6 months. Need lump sum upfront.
      • CDs are like savings accounts with a catch. You can’t touch your funds before they reach maturity, which is based on the time frame you set when you opened the account. That time period can range from months to years.
  • Rewards: how do you earn money?
    • Bonds: 1% – 4% bond returns based on data collected by New York University [13].
    • Certificates of deposit: Below 2% return since 2011 [14].
  • Time
    • Do your due diligence in choosing an FDIC-insured financial institution (up to $250k is insured).
  • Risk
    • Low risk but low returns.
    • While treasury bonds are backed by the federal government, corporate bonds are not, so you could lose your principal if the company defaults.
    • Penalties are typically on withdrawals. Do not put the money you know you will need during the bond/CD/annuity time.
    • Annuities can include high fees. Check carefully the fees and withdrawal conditions.
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools

3 Dividend stocks/ETFs/Index Funds

  • What options to earn financial rewards?
    • Index funds, stocks, and cryptos (Join Nexo and receive $25 in BTC).
  • Rewards: how do you earn money?
    • Through growth and dividends.
    • Common for dividend is AT&T giving 7% dividend [15].
  • Time
    • Do your due diligence.
      • Research whether the company is stable enough. It can stop or suspend dividends
      • Avoid just picking the highest dividend, but see if the enterprise is solid. If you don’t have the time needed, choose ETFs or index funds. They have the added value of low fees.
  • Risk
    • Reliable in long term like the S&P500 index fund.
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools

4 Flip websites/domain names/Build a website

  • What options to earn financial rewards?
    • Do you love building websites and online stores? If so, you could make passive income selling them.
    • Flip and/or build a website:
      • You can provide services such as social media consulting or operational consulting for a share of the cash flows of the business.
  • Rewards: how do you earn money?
    • Blogs usually sell for 24 times their monthly income. So if the site generates $250 a month in income, you can likely buy it for no more than $6,000. In other words, a $6,000 investment will buy you $3,000 per year in cash flow.
  • Time
    • Time-consuming activities like improving websites and consulting before getting the passive income.
  • Risk
    • Domain names: It is not wise to put too much initially: $10 to $100 to test might be acceptable. But check your budget. Check our article on How to make a budget.
  • Money needed
    • If you have capital and meet certain qualifications, you can buy a percentage of the business.
  • Tools
    • If you’re looking for a place to sell your website, you could try out Shopify’s Exchange Marketplace.
    • Buy and sell with Flippa (6,000 sites for sale in June 2021).
  • Success story:
    • Milecia McGregor, as a software engineer and owner of Flipped Coding, earns passive income by helping people to become web developers.

5 High yield CD/saving account/money market

  • What options to earn financial rewards?
    • Mainly online banks for low fees.
    • Banks’ bonus is possible on opening an account (Bankbonus).
  • Rewards: how do you earn money?
    • It can get up to 1.78% for those accounts insured by FDIC [16].
  • Time
    • Research to find the most rewarding and reliable (insured) offer.
  • Risk
    • Banks backed are covered up to $250,000 by FDIC, the money market is not always [17].
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools

6 Invest automatically in stocks Robo advisors

  • What options to earn financial rewards?
    • Company stocks
      • If you’re starting a new 9 to 5 job, be sure to ask for company stocks as part of your hiring package.
    • Robo advisors: based on a few parameters you customize, an investing strategy is defined and applied consistently.
  • Rewards: how do you earn money?
    • 10% average return S&P (10, 20 and 50 last years) [18].
    • To get $100 per month you would need to save[19]:
      • $7.5k for 5 years with compounding or $5k for 10 years with compounding.
  • Time
    • Research needed. Buffett reads 500 pages a day of financial statements to know how to properly invest. That would be actively investing. For a passive approach, one could use Robo advisors.
  • Risk
    • Volatility exists and crises happen as in 2008 and 2020. If you cannot handle the temporary decrease in the value of your portfolio, then do not risk your money. Know how risk-averse you are. You can check our article about the 2008 financial crisis.
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools
    • Betterment has Robo advisors with fees of 0.25% to 0.4%
      • Lower fees than human account managers but higher than ETFs.
      • No fee for the first $10,000 invested.
    • Bloom for 401k: detects hidden fees in current 401k. Fixed fees since $45 per year [20].

7 P2P lending

  • What options to earn financial rewards?
    • Loans to people and businesses.
  • Rewards: how do you earn money?
    • Put money in a lending platform and reap rewards.
  • Time
    • To find a good platform and a reliant loan.
  • Risk
    • Platforms lend money to people that typically do not qualify for a loan.
      • Loans can be unsecured and you could lose your investment.
      • A crisis like Covid makes them riskier as more people default on payments due to lack of income.
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools
    • Prosper, an average of 5.5% return.
    • Worthy bonds, for 5% return (Not FDIC insured).
    • PeerStreet claims a median 8.2% return for investors [21].

8 Pay-Off/Reduce debt/Refinance mortgage

  • What options to earn financial rewards?
    • Refinance debts (mortgage, credit card, student loans). This could match your Financial Planning. It is also convenient to know How to make a budget to avoid being trapped in payments that you cannot make.
  • Rewards: how do you earn money?
    • For mortgages, even a reduction of 0.5% means thousands of dollars.
  • Time
    • Research is needed to use the right platform and avoid risk.
  • Risk
    • Refinancing could charge excessive fees and you end up paying more in the long run. Avoid being misguided by short-term smaller payments that will make you pay more in the long run.
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools
    • Loan comparators (verify carefully every tool and watch out for the risk described above)
      • Credible.
      • Lending Tree.

9 REITs/Crowdfunding Real Estate

  • What options to earn financial rewards?
    • Crowdfunding is typically easier to access with an online platform.
    • Real Estate Investment Trust (REIT)
      • Individual REITs are riskier than ETFs with many REITs.
      • REITs own and manage income-producing properties and distribute the profits to investors.
  • Rewards: how do you earn money?
    • Crowdfunding (7% to 20% annual rate of return). See the tools section below for detailed returns per tool.
  • Time
    • REITs avoid the hassle of direct property management.
  • Risk
    • High as money invested is not insured.
  • Money needed
    • High. The more you have already, the more you could get. Because returns are measured as a percentage of the amount invested.
  • Tools
    • REIT: Fundrise (from $500) for non-accredited investors. Claims a historical return of 9.4% [22].
    • Crowdfunding

10 Rental Income/storage space/property value appreciation

  • What options to earn financial rewards?
    • Possibility to outsource property management and maintenance tasks for more passive investment.
    • Storage space: 1 in 11 Americans pay for storage space [23].
  • Rewards: how do you earn money?
    • Let’s say your goal is to earn $10,000 a year in rental cash flow. Assuming the property has a monthly mortgage of $2,000 and costs another $300 a month for taxes and other expenses, you’d have to charge $3,133 in monthly rent to reach your goal.
  • Time
    • Research upfront needed
      • Run the numbers (mortgage, taxes, expenses).
      • Check with the real estate agent and do your due research to buy the right property.
      • John H. Graves, author of “The 7% Solution: You Can Afford a Comfortable Retirement.” says you should determine three things [24]:
        • How much return do you want on the investment?
        • The property’s total costs and expenses.
        • The financial risks of owning the property.
  • Risk
    • There are a few questions to consider: Is there a market for your property? What if you get a tenant who pays late or damages the property? What if you’re unable to rent out your property?
  • Money needed
    • Less money than usual rental income if you already own spare storage space.
  • Tools
  • Success story
    • Shawn Breyer, owner of Breyer Home Buyers who buys houses in any situation in Atlanta in as less as 21 days.

11 Rent car/car sharing/parking space

  • What options to earn financial rewards?
    • Directly rent your car, share rides, and rent your spare parking space.
  • Rewards: how do you earn money?
    • Use an online platform to list your offer and meet customers.
  • Time
    • Needed to wash the car, insurance, repairs, etc.
  • Risk
    • Risk of people damaging cars. Less risk renting parking space.
  • Money needed
    • High if you do not have yet a car or parking space available.
  • Tools
    • Car
      • Turo (insured up to $1M if the car after 2005 and less than 130k miles used).
      • Getaround.
      • HyreCar (Rent car for Uber, DoorDash,Instacart).
    • Parking space
      • Use public offers websites like:
        • Craiglist.
        • LeBonCoin.
        • In Switzerland, PetitesAnnonces, Anibis.
        • In Latin America: MercadoLibre, etc.
      • Stow It (specifically for vehicle storage, listing space is free and 10% fee on rentals).
      • Parqex, Curbflip, SpotHero (acquired Roverparking), and Pavemint can vet users, and insure and collect payments.

12 Rent home (AirBnB), unused space

  • What options to earn financial rewards?
    • When you go on vacation (it could pay for your vacation).
    • When you are there but have unused space.
    • If you’re booking a space for an event, and you don’t need it all the time, you can look into sites like ShareMySpace. There you can advertise your available square footage to anyone who needs it.
  • Rewards: how do you earn money?
    • Amounts vary greatly based on location.
  • Time
    • Check legal requirements: If a renter wants to sub rent to someone else, the owner authorization is needed.
  • Risk
    • Risk of people damaging property.
  • Money needed
    • High, as you need to already own a home and have unused space to rent.
  • Tools
    • AirBnB
      • Available in more than 220 countries for 4 million hosts that welcomed 900 million arrivals since its creation in 2007 [25].
      • AirBnB has recently expanded into “AirBnB Experiences,” which allows you to host events, meetups, and tours in your city
      • AirBnB charges you 3% on every booking for their services [26].
    • VRBO charges 5% per booking, plus another 3% if the guest pays with a credit card.[27].
    • Vacasa is a vacation home rental management company.

13 Rent household items (sell your stuff)/ Flip retail products

  • What options to earn financial rewards?
    • Rent items like lawnmowers, power tools, mechanic tools, tents, coolers, etc.
    • Flipping products: buying low in one retailer and selling it higher in another.
  • Rewards: how do you earn money?
    • Renting items on a specialized renting website. Or use it as a means of getting in touch with customers.
  • Time
    • Low: To find the right platform and offer the item to be rented.
  • Risk
    • Risk of property damaged or stolen. Consider the liability of risky tools like power tools.
  • Money needed
    • Money is needed to buy products initially.
  • Tools
    • Arbitrage on eBay and Amazon.
    • Baby gear on babyequip.com includes insurance on items rented [28].
    • Frindswitha for all equipment.
    • Spinlister for sport.
    • Clothes
      • StyleLend for designer dresses, and accessories.
      • RentNotBuy.
      • Design brands (Oliva, Alice, Eliza J, Chanel) rent much more easily than fast fashion (Forever21, H&M).

14 Saving apps/cashback sites

  • What options to earn financial rewards?
    • Credit card rewards:
      • Valuable only if you pay off your cards every month.
      • Choose a reward program according to your spending. Maybe you travel frequently or eat out often.
  • Rewards: how do you earn money?
    • Varies depending on offers.
  • Time
    • Choose the correct credit card according to your most frequent spending. For instance, if you travel a lot, a credit card that gives more rewards for frequent travelers could be better.
  • Risk
    • Avoid too many cards to not drop your credit score.
    • Beware of apps that are not seriously concerned about privacy.
    • Avoid buying more only to get the cashback. It works only for items you were to buy anywhere
  • Money needed
    • Low. Everyone spends money. Even for basic expenses of food and shelter.
  • Tools

What is the next step?

To summarize, passive income ideas need an upfront effort. That effort can be in time or money.

For any questions on passive income like properly differentiating passive and active income, check our article How to make passive income.


[1] 99 Firms, Affiliate Marketing Statistics; at https://99firms.com/blog/affiliate-marketing-statistics/ (visited June 20, 2021).

[2] Shopify, Affiliate Program; at https://www.shopify.com/affiliates (visited June 20, 2021).

[3] Advertise Cast, Podcast Advertising Rates 2021; at https://www.advertisecast.com/podcast-advertising-rates(visited June 20, 2021).

[4] Nielsen, A MARKETER’S GUIDE TO PODCASTING; at https://www.nielsen.com/us/en/insights/report/2018/nielsen-podcast-insights-q1-2018/ (visited June 20, 2021).

[5] Screen Rant, iOS 14: How An iPhone App Icon Designer Made $100,000 In One Week; at https://screenrant.com/ios-14-iphone-app-icon-viral-design/ (visited June 20, 2021).

[6] Udemy, Instructor Revenue Share; at https://support.udemy.com/hc/en-us/articles/229605008-Instructor-Revenue-Share (visited June 20, 2021).

[7] Udemy, Instructor Payment Overview; at https://support.udemy.com/hc/en-us/articles/229604008-Instructor-payment-overview (visited June 20, 2021).

[8] Graphtreon, Hannah Witton; at https://graphtreon.com/creator/hannahwitton (visited June 20, 2021).

[9] Ness Labs, My pivotal 2018: from startup founder to indie maker; at https://nesslabs.com/annual-review-2018 (visited June 20, 2021).

[10] Ness Labs, 2020 year in review: chaos and community; at https://nesslabs.com/annual-review-2020 (visited June 20, 2021).

[11] Investopedia, How YouTube Ad Revenue Works; at https://www.investopedia.com/articles/personal-finance/032615/how-youtube-ad-revenue-works.asp (visited June 20, 2021).

[12] Internal Revenue System, S Corporations; at https://www.irs.gov/businesses/small-businesses-self-employed/s-corporations (visited June 20, 2021).

[13] New York University, Historical Returns on Stocks, Bonds and Bills: 1928-2020; at http://pages.stern.nyu.edu/~adamodar/New_Home_Page/datafile/histretSP.html (visited June 20, 2021).

[14] Business Insider, CD rate forecast for 2021: Rates will probably stay low, but they might increase later in the year; at https://www.businessinsider.com/personal-finance/cd-rate-forecast?IR=T (visited June 20, 2021).

[15] Nasdaq, T Dividend History; at https://www.nasdaq.com/market-activity/stocks/t/dividend-history (visited June 20, 2021).

[16] Federal Deposit Insurance Corporation FDIC, National Rates and Rate Caps – Monthly Update; at https://www.fdic.gov/regulations/resources/rates/ (visited June 20, 2021).

[17] Federal Deposit Insurance Corporation FDIC, Deposit Insurance Home; at https://www.fdic.gov/resources/deposit-insurance/ (visited June 20, 2021).

[18] Investopedia, What Is the Average Annual Return for the S&P 500?; at https://www.investopedia.com/ask/answers/042415/what-average-annual-return-sp-500.asp (visited June 20, 2021).

[19] U.S. Securities and Exchange Commission, Compound Interest Calculator; at https://www.investor.gov/financial-tools-calculators/calculators/compound-interest-calculator (visited June 20, 2021).

[20] Bloom, Robo Advisor Fees; at https://www.blooom.com/robo-advisor-fees/ (visited June 20, 2021).

[21] Peerstreet, Insight into PeerStreet’s Loan Performance Q4 2020; at https://www.peerstreet.com/blog/q4-2020-performance-data (visited June 20, 2021).

[22] Fundrise, Understanding Fundrise historical returns; at https://fundrise.com/education/understanding-fundrise-historical-returns (visited June 20, 2021).

[23] Curbed, Self-storage: How warehouses for personal junk became a $38 billion industry; at https://archive.curbed.com/2018/3/27/17168088/cheap-storage-warehouse-self-storage-real-estate (visited June 20, 2021).

[24] Amazon, The 7% Solution: You Can Afford a Comfortable Retirement; at https://www.amazon.com/7-Solution-Afford-Comfortable-Retirement/dp/0983573123 (visited June 20, 2021).

[25] AirBnB, About Us; at https://news.airbnb.com/about-us/ (visited June 20, 2021).

[26] AirBnB, What are Airbnb service fees?; at https://www.airbnb.com/help/article/1857/what-are-airbnb-service-fees (visited June 20, 2021).

[27] Vrbo, How is the pay-per-booking fee calculated?; at https://help.vrbo.com/articles/How-is-the-booking-fee-calculated (visited June 20, 2021).

[28] Babyquip, Explore: Baby Carrying Solutions, Clean. Safe. Insured.; at https://www.babyquip.com/carriers (visited June 20, 2021).

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